The Court of Appeal refused to stay the High Court’s orders winding up Star Elm Frames Limited and appointing a new liquidator, except for the personal costs order against former liquidator Anthony Fitzpatrick. The costs issue will abide the appeal, and payment of any fees due to Fitzpatrick for his liquidation work is suspended until the appeal is determined.
The ruling, delivered by the President on 24 August 2016, concerned only the appellants’ application for a stay. The court said it was not deciding the appeal or assessing the prospects of success of the grounds raised.
The High Court ordered the company wound up on 10 August 2016 after a three-day hearing of a petition brought by the Revenue Commissioners. It appointed Myles Kirby as liquidator, replacing the voluntary liquidation under Fitzpatrick. The High Court also ordered Fitzpatrick to hand over the company’s books, records, accounts and property, directed the company’s directors and David Sage to prepare a statement of affairs, and awarded the petitioner costs against Fitzpatrick and the company jointly and severally.
The appellants challenged aspects of those orders. Among their stated grounds were that the statutory demand claimed more than the sum actually due, that the High Court extended time for a verifying affidavit, and that Kirby should not have been appointed. Fitzpatrick also challenged the court’s jurisdiction to order him to hand over company records and the personal costs order. These were grounds advanced for the appeal, not findings made in the stay ruling.
The Court of Appeal said the company was insolvent and needed to be wound up; the main issue on appeal was who should conduct the liquidation. It observed that unsecured creditors were not expected to recover anything on the information then before the court, while preferential creditors could expect only a small proportion of what they were owed. Allegations of misconduct by the company and its operators, which the Revenue Commissioners had raised, remained to be investigated by the liquidator.
The President reasoned that granting a stay would leave Fitzpatrick in control and could deprive the Revenue Commissioners of the benefit of the High Court judgment. The court found no relevant prejudice from requiring Fitzpatrick to hand over the company’s records if he was no longer liquidator. It did, however, suspend the personal costs order and the payment of any fees due to him, while leaving calculation or assessment of those fees unaffected.
The court directed that the appeal be heard and determined as soon as practicable. It did not decide the appeal or the underlying misconduct allegations.